Bitcoin accepted for child abuse images, say net watchdogs

Bitcoin, the web-based cryptocurrency, is being accepted by a seller of illegal child abuse images and videos, according to the IWF (Internet Watch Foundation).

Research undertaken by the IWF has revealed that a commercial website selling child sex abuse images and videos is accepting purchases in bitcoins for the first time.

The discovery is significant as the nature of Bitcoin makes identifying paying customers difficult, but not impossible.

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Sarah Smith, a technical researcher at the IWF said: “We identify the payment methods used by commercial child sexual abuse distributors in order to work with third parties who can disrupt the distribution of these criminal images.

“This is the first time we’ve seen bitcoins being accepted for child sexual abuse images and videos.”

All Bitcoin transactions are public, traceable and are permanently stored by the Bitcoin network. Bitcoin addresses are the only information used to define where money is spent, but these are created privately by each user’s wallets.

That said, users typically have to reveal their identity in order to receive goods paid for, meaning Bitcoin is not totally anonymous. The official Bitcoin FAQ states that if someone created a new address each time they sent or received a payment, it can make finding out who they are difficult.

Links on hacked, legitimate websites redirect users to the images and video on a second hacked website.

The IWF was first alerted to the site in January 2014, when it heard of spam emails containing links to legitimate sites hacked to host links to child abuse circulating. Subsequent investigation revealed the extent and the nature of the operation.